Executive compensation and employee benefits—Denmark—Q&A guide

The following Share Incentives practice note provides comprehensive and up to date legal information covering:

  • Executive compensation and employee benefits—Denmark—Q&A guide
  • 1. Provide an overview of the primary sources of law, regulation and practice that govern or affect executive compensation arrangements or employee benefits.
  • 2. What are the primary government agencies or other entities responsible for enforcing these rules?
  • 3. Are any types of compensation or benefits generally subject to specific corporate governance requirements or approval by shareholders or government agencies? What is the general process for obtaining approval?
  • 4. Under what circumstances does the establishment or change of an executive compensation or benefit arrangement generally require consultation with a union, works council or similar body?
  • 5. Are any types of compensation or benefit arrangements prohibited either generally or with respect to senior management?
  • 6. What rules apply to compensation and benefits of non-executive directors?
  • 7. Must any aspects of an executive’s compensation be publicly disclosed or disclosed to the government? How?
  • 8. Are employment agreements required or prevalent? If so, what provisions are common? Are any terms prohibited or unenforceable?
  • 9. What are the prevalent types and structures of incentive compensation? Do they vary by level or type of organisation?
  • More...

Executive compensation and employee benefits—Denmark—Q&A guide

This Practice Note contains a jurisdiction-specific Q&A guide to executive compensation and employee benefits in Denmark published as part of the Lexology Getting the Deal Through series by Law Business Research (published: November 2020).

Authors: Norrbom Vinding—Torben Mølgaard Hededal; Rikke Falk Dambo

1. Provide an overview of the primary sources of law, regulation and practice that govern or affect executive compensation arrangements or employee benefits.

In Denmark, there is no single or general act covering executive compensation and employee benefits. Executive compensation and employee benefits are governed by a mixture of statutes, collective agreements and individual employment contracts between the parties. As a general rule, benefits are considered as forming a part of executive compensation.

Laws

Executive compensation may be governed by the following statutory instruments:

  1. the Financial Business Act (including executive orders issued on the basis of the said Act) applies generally to all employees employed with a financial institution and to the members of its board of directors; however, the majority of the provisions apply only to ‘risk takers’, including members of the board of directors, employees registered with the Danish Business Authority as members of the company’s executive board, and other employees whose activities may have a material impact on the company’s risk profile. The Financial Business Act also contains provisions governing employees performing work within the scope of Directive 2014/65/EU

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